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Ray has received his bank statement for the year to 31st October 2018. At the date, his own cash book showed a balance of 47,330.
Ray has received his bank statement for the year to 31st October 2018. At the date, his own cash book showed a balance of 47,330. His accountant investigated the matter, and discovered the following discrepancies: (a) Bank charges of 60 had not been entered in the cash book. (b) Cheques drawn by Ray and totalling 450 had not yet been presented to the bank. (c) Ray had not entered receipts of 530 in his cash book. (d) The bank had not credited Ray with receipts of 1,970 paid into the bank on 31st October 2018 (e) Standing order payments amounting to 1,240 had not been entered in the cash book. (f) A cheque received for 300 from a debtor had been returned by the bank marked "refer to drawer", but this had not been written back in the cash book. (9) An old cheque payment amounting to 880 had been written back in the cash book, but the bank had already honoured it. REQUIRED: (1) [6] Update entries in Cash Book of Ray on 31 October 2018. Draw up the Bank Reconciliation Statement on 31 October 2018. (ii) [4] (iii) What would be the treatment in the bank reconciliation statement if the updated cash book shows a credit balance? [5]
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